Building the Backbone: Future-Proofing Fintech Infrastructure for the Next Decade: By Anjna McGettrick

Finextra

09-07-2025

The UK fintech sector is experiencing a remarkable surge, with investment nearly tripling to $7.3 billion in the first half of 2024, defying a global downturn. However, rapid growth brings challenges including scaling operations, ensuring regulatory compliance and maintaining robust IT infrastructure. For fintech startups, navigating these complexities without in-house expertise can lead to inefficiencies and risks.
Choosing Colocation? A Strategic Move for Scalable Growth
Constructing and maintaining proprietary data centres is costly and resource intensive. Consequently, many fintech companies, from startups to billion-dollar giants, opt for colocation facilities. These facilities offer flexible, scalable solutions with high availability, security and built-in regulatory compliance, eliminating the burden of managing an entire data centre.
For fintechs expanding into multiple regions, colocation can be transformative. Leveraging facilities in key financial hubs enables lower latency, faster transaction speeds, and seamless global expansion while adhering to regional regulations. Even the largest fintech players rely on colocation to scale data operations under strict privacy rules. While some may eventually build their own data centres, colocation remains a practical and agile choice for many, delivering scalability without the constraints of rigid, expensive setups.
This approach also mirrors wider national ambitions. The UK government recently outlined its National Payments Vision – plans for a next-generation payments ecosystem, built around open banking and emerging technology. For fintechs, this underlines the importance of infrastructure designed to support rapid innovation and adaptability right now, not just when the roadmap demands it.
AI and Edge Computing: How to Power Data-Driven Finance
Artificial Intelligence (AI) is revolutionising fintech through real-time fraud detection, automated trading and risk assessment. But these use cases generate vast volumes of data that require near-instantaneous processing. As AI adoption grows, fintechs will depend increasingly on machine learning for hyper-personalised services. Having the right infrastructure in place is paramount.
But with demand soaring, data centre operators are under pressure to keep pace. To avoid a looming shortfall, the industry must double the capacity added since 2000 in less than a quarter of the time. Edge data centres offer a compelling solution by decentralising compute power, lowering latency and improving data security. This not only relieves pressure on core cloud systems but allows fintechs to deliver faster and smarter financial services to users wherever they are.
To support AI-driven fintech, edge data centres must ensure seamless power, cooling and cabling. High-power AI workloads demand sophisticated cable management, efficient cooling – often liquid-based for high-density setups – and stable, sustainable power delivery. When managed correctly, this infrastructure allows fintech organisations to scale their AI capabilities without bottlenecks or outages.
Why Cabling and Connectivity Still Matter
Ultra-low latency and high-speed connectivity are non-negotiable in fintech. Real-time payments, algorithmic trading and AI-powered services require networks that operate in milliseconds. Without robust, low-latency infrastructure fintechs face performance bottlenecks that impact profitability and user experience.
High-speed fibre connections and structured cabling are the unsung heroes of this system. They ensure that data flows instantly and securely, which is critical for applications processing thousands of transactions per second. Even fintechs using colocation facilities must prioritise quality cabling to reduce downtime and support seamless connectivity. Investing in future-ready networking also helps avoid expensive reworks as operations scale up.
Staying Ahead of Regulatory Risk
As fintechs lean into AI, they must also navigate a complex and heavily regulated landscape. GDPR, PCI-DSS and financial data protection laws aren't just compliance tick-boxes, they're vital to customer trust and business continuity. That makes a secure, well-structured foundation essential.
From January 2025, UK regulators began directly overseeing major tech providers to financial firms –including cloud storage and AI platforms – underscoring the need for fintech infrastructure that's not only high-performing, but fully auditable and compliant.
For fintechs expanding into regions like Europe, the challenge is twofold: meeting daunting regional standards like GDPR while adapting to new layers of oversight. The right infrastructure partner can simplify this complexity and keep growing fintechs firmly on the right side of regulation.
Managing IT Growth Across Offices
As fintechs grow, so do their teams and office footprints. Doubling headcount in a year isn't unusual – but without the right IT infrastructure, this rapid growth can lead to fragmentation and inefficiencies. Whether it's integrating new offices, enabling hybrid work or securing endpoints, office infrastructure must scale alongside the business.
Working with a single provider across colocation, networking, cloud and on-site IT makes that possible. Smart office setups – complete with high-speed networking, structured cabling and remote management – help fintechs maintain security and productivity across every site. Getting this foundation right from day one means fewer disruptions and more agility as new opportunities emerge.
Future-Proofing the Fintech Foundation
The fintech space is evolving fast, and only those with scalable, secure and AI-ready infrastructure will keep up. To do this, Fintechs should partner with experienced infrastructure providers that understand the demands of modern finance. Doing so will help fintechs reduce complexity, mitigate risk and stay focused on what really matters: innovation, speed and customer impact.